When 2022 Tore Through the S&P 500, This Healthcare ETF Barely Flinched. Why Isn’t It in More Retirement Accounts?

The article argues that the Health Care Select Sector SPDR Fund (XLV) acted as a defensive allocation during market stress—notably in 2022—delivering returns close to the S&P 500 while posting materially smaller drawdowns, lower beta and shorter recovery periods. Using data from Dec 1998–May 2026, XLV returned 8.21% annualized vs. SPY’s 8.71% but experienced smaller max and average drawdowns and a beta of 0.73. The author suggests retirees can tilt toward defensive sectors like healthcare as a simpler risk-reduction strategy versus complex hedges, noting XLV’s liquidity, low cost (0.08% expense ratio) and $37.5B AUM. The piece is a bullish endorsement of healthcare sector exposure as portfolio insurance.